In philanthropy, there is much written about responsive and strategic grantmaking approaches in philanthropy. Which approach is the most appropriate? Meaningful? Effective? Grantmakers have many roles to play in a community, and how they define those roles can vary greatly, so it’s important for foundations to understand both strategic and responsive options to determine which approach may be preferable.

Responsive grantmaking is being open to receiving proposals and ideas from any nonprofit and allowing the nonprofits to drive the agenda. Requests are initiated by the nonprofit, rather than by a funder seeking them out. This doesn’t mean that a foundation doesn’t have core areas of focus, but it does mean that within those areas it wishes to be responsive to the needs nonprofits feel most keenly. For example, a funder may focus on substance abuse but be open to supporting a wide range of prevention and treatment programs, as well as programs serving youth and families to address multigenerational factors that lead to abuse.

Strategic grantmaking (also called proactive grantmaking) is grantmaking with more focused goals and a defined set of strategies for how a foundation wants to accomplish those goals. The funder drives the agenda rather than the grantees, although it is best to include grantees in the creation of the goals and strategies. Strategic funders typically see themselves as accountable for successful outcomes. For example, a strategic grantmaker may decide to focus on reducing the stigma of substance abuse and deploy strategies that include a statewide communications campaign, increased support for Alcoholics Anonymous and Alanon and policy advocacy to health insurance providers to cover treatment.

Responsive and strategic grantmaking each come with a set of pros and cons, but, in truth, there will always be room for both grantmaking approaches.

Read the full article about grantmaking by Kris Putnam-Walkerly at Putnam Consulting Group

Giving Compass' Take:
• Stanford Social Innovation Review discusses the need for more innovation in the nonprofit sector to address critical issues, new challenges, questions, and opportunities.
• Is there something we can learn from Taco Bell? Yes, it's all about scaling, and the fast food franchise is just one example of how foundations can look at the for-profit sector for inspiration.
• Here's more on why scaling up our future will require systems leadership.
Three years ago, we described a sobering reality: Despite all the progress the social sector had made over the last few decades in figuring out “what works” to improve the lives of disadvantaged populations, many of the best organizations and fields were still addressing only a small fraction of the need. In pursuit of what works, most had focused too little attention on what works at scale.
The article and an accompanying series featured a set of pioneering leaders in the United States and Global South who had come to recognize this enormous “impact gap” and were experimenting with a variety of strategies to address it. Some focused on redesigning a particular direct service model to make it much more scalable, while others pursued efforts to change the wider system, context, or “equilibrium” that helped perpetuate the problem. Yet, at the time, such efforts were relatively isolated, and the funding to pursue them was limited at best.
Today, we see much progress. Indeed, it feels as if the social sector is in the midst of a fundamental shift. Many leaders have completely recast their aspirations. “Systems change” and “impact at scale” are no longer simply buzzwords. They are real targets that nonprofit and NGO leaders, boards, and staffs are working toward. Wide-reaching “indirect” impact strategies like licensing and technical assistance are springing up alongside or even supplanting leading organizations’ direct-service work. More field-building intermediaries are emerging, and action-oriented collaboratives are on the rise. “Systems leadership” and “network entrepreneurship” are hot topics of conversation.
Read the full article about impact at scale by Jeff Bradach and Abe Grindle at Stanford Social Innovation Review.

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